May 08--It's the end of an era for a 94-year-old Chicago bank.
The owner of Parkway Bank Trust, a $2.2 billion-asset lender based in Harwood Heights, plans to buy the Chicago-based owner of Park Federal Savings Bank, which has served Chicago's Southwest Side since 1921.
Parkway Bank has 24 branches in the Chicago area.
Park Federal Savings Bank has four branches in the Chicago area and $154 million in assets. Its owner is Park Bancorp. Park Federal Savings Bank will be merged into Parkway Bank.
"The board believes this is a great opportunity for the bank to be a part of an organization with considerably deeper resources, operational scale and a steady stream of core earnings," David Remijas, Park Bancorp chief executive, said in a statement.
Park Federal, which has about 50 employees, lost $2.1 million in 2014, and lost $664,000 in the first quarter.
Park Bancorp delisted its stock from the Nasdaq in 2011 and has since traded on the electronic over-the-counter market known as the "pink sheets."
The deal was announced Thursday. The thinly traded stock is at 28 cents.
If the closing occurs on or about July 31, the estimated purchase price a share could be 35 cents to 25 cents a share depending partly on the company's operating losses. Or the closing price could be less than that depending on certain factors.
Officials from the two banks couldn't be reached for immediate comment.
The deal is subject to approval by banking regulators and Park Bancorp shareholders, who are expected to vote on the matter at their annual meeting this summer. The deal is expected to close in the third quarter.
Park Bancorp has about 1.2 million shares outstanding.
Vedder Price was its legal adviser. Kirkland Ellis represented Parkway.
byerak@tribpub.com
